Futures in corn, wheat, soybeans, soybean oil and soybean
meal will debut May 14 on ICE Futures U.S., subject to
regulatory review, Atlanta-based IntercontinentalExchange said
today in a statement. The contracts will settle on a cash basis
linked to prices on CME Group’s Chicago Board of Trade.

Sugar, coffee, cocoa, cotton and orange-juice futures
currently trade on IntercontinentalExchange’s electronic
platform. ICE Futures U.S., formerly the New York Board of
Trade, ended futures floor trading in early 2008. The Chicago-
based CME Group, owner of the world’s largest futures market,
offers both pit and electronic trading. The two companies also
offer competing energy contracts.

“Customers over the past several months have approached
ICE about providing an alternate execution and clearing venue
for grain products currently listed exclusively on the CBOT,”
Lee Underwood, an ICE spokesman, said in an e-mail. “We believe
ICE will provide value to this market by offering an alternate
pool of liquidity, similar to what we did for the energy markets
almost a decade ago.”

This year, total volume on corn futures in Chicago has
averaged 335,000 contracts a day, according to data compiled by
Bloomberg. The average in sugar futures, the biggest agriculture
contract on ICE, is 110,000 contracts.

‘Why Trade There?’

“We don’t need another corn market,” said Shawn Hackett,
the president of Hackett Financial Advisors in Boynton Beach,
Florida said in a telephone interview. “The corn-futures market
is the most liquid in the world, it sets the global price, and
it’s very efficient. Maybe ICE thinks they can get market share
from the CBOT, but why would anyone want to trade there?”

CME Group’s agricultural prices “are global benchmarks
that continue to offer the deepest and most liquid markets to
customers around the globe,” Chris Grams, a spokesman, said in
an e-mail. “We believe competition is good for business, and we
will continue to work with our customers to meet their needs for
agriculture-risk management.”

MF Global

The bankruptcy of MF Global Holdings Ltd. roiled futures
markets late last year, and CME Group will require brokers to
report daily customer fund levels effective May 1.

An estimated $1.6 billion in client money related to the MF
Global (MF) bankruptcy is still missing.

ICE may be trying to “take advantage of the CME’s current
issues surrounding the MF Global debacle,” Sterling Smith, a
market analyst at Country Hedging Inc. in St. Paul, Minnesota,
said in an e-mail. “One market in the U.S. is enough, so the
success may be limited.”

CME Group also offers contracts in rice and oats on the
CBOT. The parent company has cattle, hog and dairy futures on
its Chicago Mercantile Exchange unit and offers coffee, cocoa,
cotton and sugar on its New York Mercantile Exchange.

CME offered so-called softs contracts in New York to
compete with ICE, and “it failed badly,” Smith said.

ICE said in February that net income rose 28 percent in the
fourth quarter to $127 million from a year earlier. The shares
rose 0.5 percent to $134.13 at 4:15 p.m. in New York Stock
Exchange composite trading. They have climbed 11 percent in the
past 12 months.

In February, CME Group reported fourth-quarter profit that
trailed estimates by analysts as volumes eased in late 2011.

CME Group rose 1.2 percent to $287.49. The stock has
dropped 4.7 percent in the past 12 months. The company also
offers contracts linked to interest rates and equity indexes.